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The Mediation Effect of Education on Self-Esteem and Wages

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Abstract

Research suggests a positive relationship between adolescent self-esteem and adult wages. Drawing data from the 1979 cohort of the National Longitudinal Survey of Youth, I refine the empirical relationship between self-esteem, wages, and education. The effect of self-esteem on wages is positive and significant when estimating models for the entire sample. This effect, however, becomes statistically insignificant when estimating models for subsamples sorted by educational level. In addition, mediation models suggest that roughly one-third of the total effect of self-esteem on wages is mediated by education. In total, these results indicate that there is a significantly less pronounced direct effect of self-esteem on wages than previously found in the literature. A substantial portion of the effect self-esteem has on wages occurs through its effect on educational attainment.

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Notes

  1. Some examples to help clarify the meaning of degree completion thresholds: One subsample includes those with exactly a bachelor’s degree. Another subsample includes those with exactly a high school diploma, etc.

  2. In these mediation models I also employ standard human capital covariates.

  3. The research investigates noncognitive traits in general—which includes SE.

  4. This is when the core, and as I am interpreting, most important SE measurement is collected. This core SE has the least potential to be endogenous with an individual’s economic outcomes.

  5. This measurement is nonmalleable by post-adolescent and post-childhood variables. These post-adolescent variables will confuse the true meaning of a later measurement of SE’s effects on economic outcomes.

  6. As a measure of sensitivity analysis I also conducted each model using dependent variables in the year 2000. Results of these models are similar to those using year 2004 variables and are available upon request.

  7. I choose 2004 as the cutoff year as the question is not asked afterwards in the survey.

  8. The Rosenberg questionnaire in the NLSY79 is as follows:

    1. I am a person of worth. 2. I have a number of good qualities. 3. I am inclined to feel that I am a failure.

    4. I am as capable as others. 5. I feel I do not have much to be proud of. 6. I have a positive attitude. 7. I am satisfied with myself. 8. I wish I had more self respect. 9. I feel useless at times. 10. I sometimes think I am “no good” at all.

  9. See Drago (2011) or see the literature review in this article for information on core SE.

  10. As is standard practice with noncognitive variables (see Drago 2011; Cebi 2007, Goldsmith, Veum and Darity 1997)

  11. The results of cognition on educational attainment and wages are that AFQT is generally highly significant and positive. The specific magnitudes are suppressed in the majority of the tables, but the results are available from the author upon request.

  12. Full explanation of which covariates are included in the log-wage, educational attainment and mediation models are included in the notes of each corresponding table.

  13. This means the sample includes those with Associate, Bachelor, Master’s, Doctoral and Specialist degrees, as well as those with only a high school diploma.

  14. The exact list of control variables can be found in the notes section of Table 3.

  15. The parameter estimates for the covariates and constant are suppressed, but are available from the author upon request.

  16. The full list of control variables can be found in the notes section of Table 4.

  17. The parameter estimates for the covariates and constant are suppressed, but are available from the author upon request.

  18. Originally I used Heckman selection models (Heckman 1979) to ascertain this effect. Results showed a moderate selection effect of SE on education, depending upon model specification.

  19. Results from this simple model are shown in column 1 of Table 5. This model includes no covariates.

  20. The complete list of control variables can be found in the notes section of Table 5.

  21. Equations (1) and (2) are found in sections 4.2 and 4.3 of the paper, respectively.

  22. I also implemented the same two residual diagnostic tests for the models using year 2000 data. I obtained the same qualitative results, and conclude that the error terms are uncorrelated. Results are available upon request.

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Acknowledgments

I would like to thank Mark Owens, Joachim Zietz, Christian Brown, Josh Hill, and E. Anthon Eff for helpful assistance, comments, suggestions, and editing related to this article. All errors are my own.

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  1. School of Business, Black Hills State University, Spearfish, SD, 57799, USA

    Robert Girtz

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  1. Robert Girtz
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Correspondence to Robert Girtz.

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Girtz, R. The Mediation Effect of Education on Self-Esteem and Wages. J Labor Res 35, 358–372 (2014). https://doi.org/10.1007/s12122-014-9187-3

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